Abu Dhabi National Oil Company signed three preliminary agreements with Austria’s OMV and Borealis to expand their petrochemical collaboration as the state-owned company forges ahead with plans to develop its downstream sector.
Under the first agreement, Adnoc and OMV will “evaluate new opportunities in petrochemical projects as a potential extension to their existing partnerships,” Adnoc said in a statement on Saturday. Under the second agreement, Adnoc and OMV will “explore the potential of OMV’s ReOil technology in Ruwais,” the industrial hub of the national oil company. Under the third agreement, Adnoc and Borealis will “jointly explore potential growth opportunities within the integrated polyolefin industry in key geographical markets.”
Adnoc, OMV and Borealis are expanding their partnership as the national oil company seeks to spend $45 billion to develop downstream projects with partners in Ruwais. Under Adnoc’s 2030 strategy, the company plans to triple production of petrochemicals to 14.4. million tons per annum by 2025.
"The agreements with OMV build on, and further strengthen, our long-term partnership across the full oil and gas value chain,” said Dr Sultan Al Jaber, Minister of State and Adnoc group chief executive.
"In line with our downstream expansion strategy, Adnoc is pursuing investments that will maximise value from our existing resources and secure more effective market access for our expanding portfolio of products.”
Adnoc and Borealis are partners in Borouge, the petrochemical company with an annual production capacity of 4.5 million tonnes. OMV, which is parly owned by Abu Dhabi’s Mubadala Investment Company, has recently snapped up a number of stakes in Adnoc projects and units.
OMV bought a 15 per cent stake in Adnoc Refining, giving the unit an enterprise value of $19.3bn. OMV also won last year a 5 per cent stake in Ghasha ultra-sour gas project under a 40-year concession and 20 per cent stakes in Sarb and Umm Lulu oil fields.
“The proposed agreement with Borealis, an existing strategic partner, will potentially create growth opportunities for our mutual benefit, and ensure we are well positioned to meet the growing demand for a variety of high-value refined and petrochemical products,” said Dr Al Jaber.